UK High Court Decision Could Prohibit Sales of Huawei Smartphones in UK

UK High Court Decision Could Prohibit Sales of Huawei Smartphones in UK

Huawei must license patents from Unwired Planet on a global basis in order to prevent intellectual property infringement within the UK, or be barred from selling in UK.

A patent dispute in the UK could spell massive trouble for Huawei who is on the receiving end of a judgement from the UK High Court’s patent arm. The current judgement requires Huawei to license patents from Unwired Planet on a global basis in order to prevent intellectual property infringement within the UK.

The case began when Unwired Planet sued Huawei, Google and Samsung in 2014 for infringing on six of its UK patents, of which five were claimed to be standard-essential patents (SEP). An SEP is an invention which must be used to comply with a technical standard, and such patents should be licensed on fair, reasonable and non-discriminatory (FRAND) terms to all. Huawei’s arguments were that Unwired Planet was in breach of competition law as well as its FRAND obligations by seeking a worldwide licence rather than a UK-only licence.

The judgement came in favor of Unwired Planet. The judge ruled that there was no breach of competition law and that Unwired Planet is entitled to license it patents on a global basis. The court was of the view that a final injunction to restrain infringement of the patents EP (UK) 2 229 744 and EP (UK) 1 230 818 [licenses concerning LTE infrastructure and GSM/UMTS infrastructure] against Huawei will be considered at another hearing once Unwired Planet have drawn up a full set of the terms of the worldwide licence incorporating the decisions made in the judgement.

The decision is important because it holds the possibility of restricting Huawei from selling any patent-infringing phones in the UK until it agrees to the global FRAND licence. Previously, infringing parties could get away by paying fines which come out to be about the royalty rate they would have had to pay anyway, and that too, only in the country they were sued.

The parties to the dispute did go into trial while offering a pricing scheme to each other for the related licences. The Court did not deem either offer to be FRAND, with Unwired Planet overstating the value of its portfolio and Huawei understating it.

A Huawei spokesperson told ZDNet the following on this issue:

We welcome the decision by the Court that Unwired Planet’s royalty rate demands have been found to be unreasonable.¬†Huawei is still evaluating the decision, as well as its possible next steps. Huawei does not believe that this decision will adversely affect its global business operations.¬†As one of the world’s leading intellectual property rights (IPR) owners, Huawei has a strong record of respecting the IPR of others, in addition to doing whatever is required to protect our own such IPR assets. Huawei remains committed to provide its cutting-edge products and services to our customers without interruption.

Unwired Planet procured most of its 2G GSM, 3G UMTS and 4G LTE patents from Ericsson. After filing against Huawei, Samsung and Google, the company had offered to licence them its global portfolio in April 2014. All three refused, denying the importance of the patents and its infringement as well as their validity. A subsequent offer made in July 2014 was settled and accepted by Google in mid-2015 and Samsung in mid-2016.

The final injunction will be considered at a hearing in a few weeks time.

What are your thoughts on the injunction against Huawei for patent infringement? Let us know in the comments below!

Source: ZDNet

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